Search form

You are here

Saying ‘I Do’ might mean ‘I Can’t’ for Roth IRA

Submitted by Baycity1 on Thu, 06/07/2018 - 8:17am

June is a popular month for weddings.
If you’re tying the knot, it’s an exciting time, but be aware that your status as a married person might affect you in unexpected ways – including the way you invest.
For example, if you and your new spouse both earn fairly high incomes, you may find that, together, you make too much to contribute to a Roth IRA.
One way around this problem is to open a “backdoor” Roth IRA by converting a traditional IRA into a Roth.
By doing so, you can get past the income limits, and you can generally move as much money as you want.
However, you’ll probably have to pay taxes on the conversion, and the money going into the Roth might bump you into a higher tax bracket, at least temporarily.
So consult with your tax advisor before opening this backdoor.
In any case, as you think about Roth IRA contributions, take the time to explore all the ways you and your new spouse can create a positive investment strategy for your future.
Edward Jones, its employees and financial advisors cannot provide tax or legal advice.
You should consult your attorney or qualified tax advisor regarding your situation.
This article was written by Edward Jones for use by your local Edward Jones Financial Advisors John Dickerson & Hawes Dickerson. Member SIPC.